Pinpointing Entry & Exit Points

Transcription

1 This tutorial was originally titled The Four Steps to 80% Day Trading Success and was recorded at the Online Trading Expo Pinpointing Entry & Exit Points Dr. John F. Clayburg - clayburg@pionet.net Copywrite 2000 Traders Library

2 The Four Steps To 80% Day Trading Success 1. Define the major trend of the day. 2

3 The Four Steps To 80% Day Trading Success 1. Define the major trend of the day. 2. Define the minor trend within the major trend. 2

4 The Four Steps To 80% Day Trading Success 1. Define the major trend of the day. 2. Define the minor trend within the major trend. 3. Define a specific entry point 2

5 The Four Steps To 80% Day Trading Success 1. Define the major trend of the day. 2. Define the minor trend within the major trend. 3. Define a specific entry point 4. Define a specific exit point 2

6 Step One Define the major trend of the day. One hour into the session, determine that either the high or the low of the day has been set. Thus the trend of the day has been defined. If the low is in place, the trend is up for the rest of the day. If the high is in place, the trend is lower for the rest of the day. 3

7 Step One Define the major trend of the day. Trend Definition based on Range Expansion 4

8 Step One Define the major trend of the day. Trend Definition based on Range Expansion Probability that the entire range of the day has been established one hour into the market is remote. 4

9 Step One Define the major trend of the day. Trend Definition based on Range Expansion Probability that the entire range of the day has been established one hour into the market is remote. Any range expansion will occur on the high side of the range on an up day and on the low side on a down day. 4

10 Step One Define the major trend of the day. Why is this Important? 5

11 Step One Define the major trend of the day. Why is this Important? Trade with the trend. 5

12 Step One Define the major trend of the day. Why is this Important? Trade with the trend. Traders are constantly looking to pick tops and bottoms, thus trading against the trend. 5

13 Step One Define the major trend of the day. Why is this Important? Trade with the trend. Traders are constantly looking to pick tops and bottoms, thus trading against the trend. Profits are more likely trading in the direction of the current daily trend. 5

14 Step One Define the major trend of the day. Take Trades only in the Direction of the Major Trend 6

15 Step One Define the major trend of the day. Take Trades only in the Direction of the Major Trend Take only buy signals on an up day. 6

16 Step One Define the major trend of the day. Take Trades only in the Direction of the Major Trend Take only buy signals on an up day. Take only sell signals during a down day. 6

17 Step One Define the major trend of the day. Take Trades only in the Direction of the Major Trend Take only buy signals on an up day. Take only sell signals during a down day. Use opposite side signals as exits, but not for entry. 6

18 Step One Define the major trend of the day. How do we determine the trend? 7

19 Step One Define the major trend of the day. How do we determine the trend? 1. CD Market Direction Indicator 7

20 Step One Define the major trend of the day. How do we determine the trend? 1. CD Market Direction Indicator 2. CD Median Line Indicator 7

21 CD Market Direction Indicator 8

22 CD Market Direction Indicator 9

23 CD Median Line Indicator 10

24 CD Median Line Indicator CD Market Direction Indicator 11

25 CD Median Line Indicator CD Market Direction Indicator 12

26 CD Median Line Indicator CD Market Direction Indicator 13

27 CD Median Line Indicator CD Market Direction Indicator 14

28 Step Two Determine the Short Term Trend Exhaustion of Corrective Move 15

29 Step Two Determine the Short Term Trend Use Four Indicators to Identify Exhaustion 16

30 Step Two Determine the Short Term Trend Use Four Indicators to Identify Exhaustion All are looking for exhaustion of a correction 16

31 Step Two Determine the Short Term Trend Use Four Indicators to Identify Exhaustion All are looking for exhaustion of a correction All do so in their own method 16

32 Step Two Determine the Short Term Trend Use Four Indicators to Identify Exhaustion All are looking for exhaustion of a correction All do so in their own method Mathematical Algorithm 16

33 Step Two Determine the Short Term Trend Use Four Indicators to Identify Exhaustion All are looking for exhaustion of a correction All do so in their own method Mathematical Algorithm Pattern Recognition 16

34 Step Two Determine the Short Term Trend One Indicator - Significant 17

35 Step Two Determine the Short Term Trend One Indicator - Significant Two Signals - Significance Increases 17

36 Step Two Determine the Short Term Trend One Indicator - Significant Two Signals - Significance Increases Three Signs of Exhastion - Higher Confidence 17

37 Step Two Determine the Short Term Trend One Indicator - Significant Two Signals - Significance Increases Three Signs of Exhastion - Higher Confidence All Four - Maximum Confidence of an Exhausted Correction 17

38 Four Indicators Step Two Determine the Short Term Trend 18

39 Four Indicators 1. CD Reversal Step Two Determine the Short Term Trend 18

40 Four Indicators 1. CD Reversal Step Two Determine the Short Term Trend 2. CD Real Time Pivot 18

41 Four Indicators 1. CD Reversal Step Two Determine the Short Term Trend 2. CD Real Time Pivot 3. CD Exhaustion 18

42 Four Indicators 1. CD Reversal Step Two Determine the Short Term Trend 2. CD Real Time Pivot 3. CD Exhaustion 4. CD Cluster 18

43 Step Two CD Reversal Indicator Appear as cyan squares below the bars or magenta squares above the bar 19

44 Step Two CD Reversal Indicator Appear as cyan squares below the bars or magenta squares above the bar First appearance is indicative of a trend which is experiencing early signs of exhaustion. 19

45 Step Two CD Reversal Indicator Appear as cyan squares below the bars or magenta squares above the bar First appearance is indicative of a trend which is experiencing early signs of exhaustion. When the indicator stops plotting the exhaustion phase is completed 19

46 Step Two CD Reversal Indicator Appear as cyan squares below the bars or magenta squares above the bar First appearance is indicative of a trend which is experiencing early signs of exhaustion. When the indicator stops plotting the exhaustion phase is completed A trend change is now expected 19

47 Step Two CD Reversal Indicator 20

48 Step Two CD Reversal Indicator 21

49 Step Two CD Real Time Pivot Indicator Buy Signals are plotted as blue dots below the bar 22

50 Step Two CD Real Time Pivot Indicator Buy Signals are plotted as blue dots below the bar Sell Signals are plotted as red dots above the bars 22

51 Step Two CD Real Time Pivot Indicator Buy Signals are plotted as blue dots below the bar Sell Signals are plotted as red dots above the bars Plots do appear in real time, as the name suggests. 22

52 Step Two CD Real Time Pivot Indicator Buy Signals are plotted as blue dots below the bar Sell Signals are plotted as red dots above the bars Plots do appear in real time, as the name suggests. Dots are printed when the bar closes. 22

53 Step Two CD Real Time Pivot Indicator 23

54 Step Two CD Real Time Pivot Indicator 24

55 Step Two CD Real Time Pivot Indicator 25

56 Step Two CD Real Time Pivot Indicator 26

57 Step Two CD Exaustion Indicator Consists of four plotted lines 27

58 Step Two CD Exaustion Indicator Consists of four plotted lines Market tries to stay in a comfort zone between the two yellow bands 27

59 Step Two CD Exaustion Indicator Consists of four plotted lines Market tries to stay in a comfort zone between the two yellow bands When the market strays outside these bands a trading signal is set up 27

60 Step Two CD Exaustion Indicator 28

61 Step Two CD Exaustion Indicator 29

62 Step Two CD Exaustion Indicator 30

63 Step Two CD Exaustion 2 Indicator 31

64 Step Two CD Cluster Indicator Most complicated of the short term group 32

65 Step Two CD Cluster Indicator Most complicated of the short term group Usually the last to appear 32

66 Step Two CD Cluster Indicator Most complicated of the short term group Usually the last to appear Can be used as the final confirmation of exhaustion 32

67 Step Two CD Cluster Indicator 33

68 Step Two CD Cluster Indicator Step Two CD Cluster Indicator 34

69 Step Two CD Cluster Indicator 35

70 All Four 36

71 Trade Sequence 37

72 Trade Sequence 38

73 Trade Sequence 39

74 Trade Sequence 40

75 Trade Sequence 41

76 Step Three Entry CD Entry Point Indicator 42

77 Step Three Entry CD Entry Point Indicator Measures Short Term Support and Resistance 42

78 Step Three Entry CD Entry Point Indicator Measures Short Term Support and Resistance Place buy stops and sell stops 42

79 Step Three CD Entry Point 43

80 Step Three CD Entry Point 44

81 Step Four Exit Trailing Stop 45

82 Step Four Exit Trailing Stop CD Entry Point 45

83 Trailing Stop CD Entry Point CD Volatility Stop Step Four Exit 45

84 Trailing Stop CD Entry Point Step Four Exit CD Volatility Stop CD Cluster Volatility Stop 45

85 Trailing Stop CD Entry Point Step Four Exit CD Volatility Stop CD Cluster Volatility Stop CD Real Time Target 45

86 Step Four Exit - Trailing Stop 46

87 Step Four Exit - Volatility Stop 47

88 Step Four Exit - Cluster Volatility Stop 48

89 Step Four CD Real Time Target Exit 49

90 Step Four CD Real Time Target 50

91 Step Four CD Real Time Target 51

92 Step Four CD Real Time Target 52

93 Step Four CD Real Time Target 53